Westlake Chemical Recent Insider Activity

In a recent SEC filing, it was revealed that Andrew Kenner, SVP at Westlake Chemical WLKP, made a noteworthy insider purchase on May 14,.

What Happened: Kenner made a significant move by purchasing 7,178 shares of Westlake Chemical as reported in a Form 4 filing with the U.S. Securities and Exchange Commission. The transaction's total worth stands at $158,439.

As of Tuesday morning, Westlake Chemical shares are down by 0.0%, currently priced at $22.19.

Unveiling the Story Behind Westlake Chemical

Westlake Chemical Partners LP is a part of the chemical industry in the United States. Its operations are conducted through OpCo, it acquires and develop ethyelene production facilities, which convert ethane into ethylene. OpCo sells ethylene and its co-products such as propylene, crude butadiene, pyrolysis gasoline, and hydrogen to Westlake and other customers located in the United States. Its assets include three ethylene production facilities in Calvert City, Kentucky, and Lake Charles, Louisiana.

Key Indicators: Westlake Chemical's Financial Health

Revenue Growth: Westlake Chemical's revenue growth over a period of 3 months has faced challenges. As of 31 March, 2024, the company experienced a revenue decline of approximately -7.48%. This indicates a decrease in the company's top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Materials sector.

Key Profitability Indicators:

• Gross Margin: The company excels with a remarkable gross margin of 35.89%, indicating superior cost efficiency and profitability compared to its industry peers.

• Earnings per Share (EPS): Westlake Chemical's EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of 0.42.

Debt Management: With a high debt-to-equity ratio of 1.44, Westlake Chemical faces challenges in effectively managing its debt levels, indicating potential financial strain.

Evaluating Valuation:

• Price to Earnings (P/E) Ratio: The P/E ratio of 14.41 is lower than the industry average, implying a discounted valuation for Westlake Chemical's stock.

• Price to Sales (P/S) Ratio: The current P/S ratio of 0.67 is below industry norms, suggesting potential undervaluation and presenting an investment opportunity for those considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Westlake Chemical's EV/EBITDA ratio, lower than industry averages at 2.39, indicates attractively priced shares.

Market Capitalization: With restricted market capitalization, the company is positioned below industry averages. This reflects a smaller scale relative to peers.

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Navigating the Impact of Insider Transactions on Investments

It's important to note that insider transactions alone should not dictate investment decisions, but they can provide valuable insights.

Within the legal framework, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as per Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are mandated to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

Navigating the World of Insider Transaction Codes

Digging into the details of stock transactions, investors frequently turn their attention to those taking place in the open market, as outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Westlake Chemical's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.